What I learned at a Managed Service Provider

It has been 9 months since I started working at a managed service provider in Omaha, where I am living now. It’s not a long time, but I have learned quite a bit and some are more profound than others.

To back up a little bit, a managed service provider is a fancy term for an IT outsourcing company. In simpler words, consider it like an advertising agency, but for IT services. If your company doesn’t have the personnel or expertise for IT needs, managed service providers are where to seek help

In this post, I’ll get to some of the things I learn and considered among the most profound personally.

IT space moves at an unbelievable speed.

In the IT world, innovation happens vertically and horizontally. Once a new breakthrough was brought to this world by one or a few pioneers, it won’t take long before many followers copy and offer alternative options to the original innovation. Some popular points of differentiation can be pricing, integration with other tools, user experience, speed, flexibility of contracts or, my favorite, customer service. As a result, innovation takes place horizontally.

Another direction for innovation in the IT space is to invent a new technology that supports or is built upon the incumbent/existing ones. It is crucial to know that no tool or technology is perfect. By identifying and trying to negate the weaknesses in every tool, service or product, innovators in the IT space give birth to new offerings. From what I have observed so far, that process happens at a lightning speed. As a result, innovation takes place vertically.

Let me give you examples with popular services that you are more likely familiar with. In the past, companies had to buy expensive servers to run their applications. That approach had a lot of downsides such as

Slow time-to-market (red tape, slow purchasing process)

High-maintenance – staff has to monitor around-the-clock in case there is a glitch

Lack of scalability – if businesses want to expand the capacity a little bit, they have to invest in the whole new hardware; which is a waste

Inefficiency – Servers usually aren’t used to their capacity. As a result, running them around the clock is a waste of time. Plus, staff has to spend time on updates, maintenance and security

Lack of customization – On top of a piece of hardware can there be only one operating system. Hence, if an application needs to be run on different operating systems, companies have to add more hardware. It would add to the waste of resources

Lack of expertise – small companies that don’t have IT staff cannot afford to hire IT personnel and invest in infrastructure at the same time

Infrastructure-as-a-Service is a solution to that, addressing the weaknesses of traditional on premise servers listed above. With IaaS, companies outsource the most foundational parts of their IT infrastructure to suppliers. AWS was the first IaaS provider and it didn’t take long for them to have competition in Rackspace, Google Cloud Platform and Microsoft Azure, each claiming to have advantages over the others. They are called Public Cloud Providers. Then, companies copy the model at a smaller scale, building enterprise-grade architecture and leasing it to other firms. From there, a complementary tool allowing a comparison of these providers’ prices is needed and of course, was born.

After a while, people realized even though some components of the infrastructure are already outsourced, there is still a lot of work left that can be outsourced too. Hence, a new model called Platform-as-a-Service was born. In this model, companies only have to worry about developing applications. The rest is already taken care of. Obviously enough, the task of developing applications was soon “outsourced” too, resulting in what is called Software-as-a-Service (SaaS). With SaaS, companies buy ready-to-use software from vendors without having to care about anything else. Examples are what we use almost on a daily basis: Google Drive, Dropbox, Salesforce or Mailchimp, just to name a few. Each software serves a particular function and in that particular market, rest assured that it will have competitors.

I hope with that oversimplified example, I make my point that innovation (competition) can take place horizontally and vertically in IT. One thing leads to another and more. And that process happens, I can’t stress it enough, breathtakingly fast. AWS was introduced in 2006. 12 years later, there are so many public and private cloud providers. We have container technology and its providers such as Kubernetes or Docker. We have Pivotal Cloud Foundry as a Platform-as-a-Service and countless Software-as-a-Service offerings none of which would be impossible without cloud technology.

If you work in it, be prepared to read constantly

As I mentioned above, innovation happens constantly in IT at every single level. Look at the image above. Innovation doesn’t take place at the model level. It happens at the component level such as storage, networking, virtualization, etc…If you want to be reasonably informed, let alone being an authority or expert, reading constantly every day, understanding hundreds of concepts as well as various acronyms, and linking everything together is a must. The silver lining here is that with the Internet, there is no lack of resources to learn.

Be careful what you wish for

Data is the lifeblood of business today. Invest in the data. Analyze. Extract the insights. Act. Sounds easy, right? Not quite.

As almost all businesses go online and everybody has access to the Internet at any given time in a day, acquiring data shouldn’t be an issue. To manage the data; however, is another story. Statistical methods used to extract insights from data grow in effectiveness as data grows in quantity. The problem is that the more data a firm has, the more it has to invest in IT infrastructure. Everything from servers and storage to network has to be upgrade accordingly to accommodate the growing data. Plus, data analytics tools such as Tableau are highly expensive. The alternative is to hire data scientists skillful in free language such as R or Python. However, those individuals are in high demand nowadays and command a hefty salary.

But that’s not over. As data controllers, your responsibility for securing the data and using it responsibly is more important than ever. Compliance regulations are tighter than ever. Failure to comply can result in serious consequences. Industries such as healthcare have to invest to comply with HIPAA, for instance. Unfortunately, the required security services that help businesses comply can be very expensive. Here are a few things, including but not limited to, that are needed to comply with HIPAA:

As you can tell, the bills can be more expensive than your expectation, fast.

IT – The powerful enabler

I believe people and processes in an organization decide its fate and success. And I believe IT is a powerful enabler of those two vital factors. Tricky, fast changing and possibly expensive as it is, IT is an indispensable piece of the puzzle, helping firms, at the end of the day, do two things: save money and time.

Let’s take a look at a few examples. Dropbox used to host their application and data on AWS, but decided to build their own server. The move saved them $75 million. Regarding application development, Pivotal Cloud Foundry, a fairly new but meteoric Platform-as-a-Service, is reported to save millions of dollars and hours of work for developers. Without a robust disaster recovery (a service that quickly brings a server back up in case it goes down), companies in some industries can lose at least $6 million per every hour of downtime. These examples go to show that IT, if deployed properly, can bring a firm a competitive advantage, or improve the bottom line at the very least.

I hope that one day, this experience can be one of the dots I can connect